Have you been having trouble paying your bills? Are you getting dunning notices from creditors? Are your accounts being given over to collectors? Are you concerned about having your home repossessed or your car?
If you are receiving collection notices or having problems making your home or car payment, you’re not alone. If the crisis is attributable to illness, loss of employment or simply overspending, it usually is overwhelming. Do not let your plight go from bad to worse through inaction.
Consider:
- Realistic budgeting
- Credit counseling from a reputable organization
- Debt consolidation
- Bankruptcy
How can you know which could work best for you? It depends on your level of debt, your level of discipline along with your prospects for the future.
Contacting Your Creditors
Contact your creditors immediately in case you are having problems making ends meet. Explain why it’s difficult for you, and attempt to determine a modified payment plan that reduces your payments to a more manageable level.
Dealing with Debt Collectors
The Fair Debt Collection Practices Act dictates how and when a debt collector may contact you. They may not:
- Call you before 8 a.m. or after 9 p.m.
- Call you at work if the collector knows that your employer doesn’t approve of the calls
- Harass or threaten you
- Make false statements
- Use unfair practices, such as deposit a post-dated check, when they try to collect a debt
Debt collectors must honor a written request from you to stop further contact.
Developing a Budget
Taking charge of your plight starts with a realistic assessment of your budget: How much comes in and how much is spent each and every month. Obviously, conventional wisdom tells us we need to spend only what we earn in pay, but it sometimes doesn’t work out like that especially if an urgent situation arises.
Writing down your complete expenses – fixed and variable – is a sensible way to track spending patterns and remove the ones that aren’t as essential as rent, car, utilities, food, etc.
Credit Counseling
You could possibly consider contacting a credit counselor if the debts are overwhelming you and can’t figure out how to solve it yourself.
Creditors may be prepared to accept reduced payments simply by entering a debt repayment plan with a reputable company. In these plans, you deposit money monthly with the service who then pays your creditors.
Successful plans need regular, timely payments and may take 48 months (four years) or even more to complete. Some service providers charge a minute fee or nothing for managing your money. Others charge a monthly fee that could increase in time. You will also find credit counseling services which can be partly funded by creditors so you might not need to pay a fee.
While a debt repayment plan can eliminate much of the stress that comes from coping with creditors and overdue bills, it doesn’t mean you may forget about your debts. You still are liable for:
- Paying any creditors whose debts are not included in the plan
- Reviewing monthly statements from your creditors to make sure your payments have been received
- Making sure that your billing statements reflect any agreement your creditors made to lower or eliminate interest and finance charges, or waive late fees
A debt repayment plan doesn’t erase your negative credit ratings. Accurate information regarding your accounts can stay on your credit reports for about seven years. A demonstrated pattern oftimely payments, however, will help you get credit in the future.
Auto and Home Loans
Debt repayment plans usually coverunsecured debt. Your auto and home loan, that can be considered secured debt, will not be included. You have to keep making payments to these creditors directly.
Most automobile financing agreements allow a creditor to claim your car whenever you’re in default. No notice becomes necessary. In case your car is repossessed, you may have to pay for the complete balance due on the loan, as well as towing and storage costs, to get it back. If you can’t do that, the creditor may sell the car. If you see default approaching, you may well be happier selling the car yourself and paying off the debt: you will avoid the added costs of repossession and a negative entry on your credit report.
When you get behind on your own mortgage, speak to your lender immediately to stop foreclosure. Most lenders are willing to talk with you if they believe you’re acting in good faith and the situation is temporary. Some lenders may reduce and sometimes suspend your instalments for a few days. Once you resume regular payments, though, you could have to pay yet another amount toward the past due total. Other lenders may agree to change the terms of the mortgage by extending the repayment period to relieve the monthly debt.
For help with a Macon GA chapter 7 bankruptcy, contact a bankruptcy lawyer Macon Georgia. A Macon bankruptcy attorney could give you the help you need.
